As I see it, modern American conservatism is suffering from a severe deficit of ideas. Back in 1980, the year of the Reagan revolution, the movement was brimming with initiatives. Cut income taxes. Deregulate industries. Get tough on inflation. Get tough on crime. Spend a bunch on the military to scare the Soviet Union. Bust unions. Get tough on drugs. Teach kids not to have sex before marriage. Put Christianity back in public schools.

Fast forward three decades, and that brand of conservatism has lost its raison d'etre. Some of its ideas succeeded, some failed, most had mixed results, but almost none of them has anywhere left to go. Tax rates are already unsustainably low. Stagflation has given way to a liquidity trap. 2.3 million of our people are behind bars. Private-sector unions are a memory, as is the USSR.

So when you ask conservatives for ideas these days, they can make only three suggestions. Cut income taxes EVEN MOAR. "Drill here drill now" (i.e. shut our eyes really tight and wish we were Saudi Arabia). And the third idea... ... ...the EPA? No, that isn't it...oops.

Which is where Peter Thiel comes in. In a brilliant (and only occasionally kooky) article in the National Review, Thiel claims that we are experiencing a long-term slowdown in technological progress (Tyler Cowen's "Great Stagnation"). Without a steady upward march of new inventions and higher productivity, he believes, the world will revert to a zero-sum game:

The technology slowdown threatens not just our financial markets, but the entire modern political order, which is predicated on easy and relentless growth. The give-and-take of Western democracies depends on the idea that we can craft political solutions that enable most people to win most of the time. But in a world without growth, we can expect a loser for every winner. Many will suspect that the winners are involved in some sort of racket, so we can expect an increasingly nasty edge to our politics. We may be witnessing the beginnings of such a zero-sum system in politics in the U.S. and Western Europe[.]

This rings true to me. The middle-class society that liberals have struggled to create seems liable to degenerate into class warfare when the pie stops growing (note that in the U.S. it has been the rich who have initiated and won this class warfare in recent times).

Thiel also recognizes that tax cuts, the conservative movement's magic cure-all-that-ails-ya, are an unsustainable short-term palliative rather than a long-term efficiency booster:

A mischievous person might even ask whether “supply-side economics” really was just a sort of code word for “Keynesianism.” For now it suffices to acknowledge that lower marginal tax rates might not happen and would not substitute for the much-needed construction of hundreds of new nuclear reactors.

Hmm, you don't say!

And then, at the end of his rant, Thiel slips in the paragraph that has the potential to change American conservatism:

Let us end with the related question of what can now be done. Most narrowly, can our government restart the stalled innovation engine?

The state can successfully push science; there is no sense denying it. The Manhattan Project and the Apollo program remind us of this possibility. Free markets may not fund as much basic research as needed. On the day after Hiroshima, the New York Times could with some reason pontificate about the superiority of centralized planning in matters scientific: “End result: An invention [the nuclear bomb] was given to the world in three years which it would have taken perhaps half a century to develop if we had to rely on prima donna research scientists who work alone.”...

Today a letter from Einstein would get lost in the White House mail room, and the Manhattan Project would not even get started; it certainly could never be completed in three years. (emphasis mine)

HALLELUJAH. Public goods FTW!!!

Peter Thiel recognizes and admits what doctrinaire conservatives have been loath to admit: government is not always and everywhere the problem. Sometimes, when externalities and public goods exist, government is the solution.

Conservatives, wedded to the drown-government-in-a-bathtub approach that worked so well for them in the 80s, have since been forced into taking the untenable, indefensible, goonball-"libertarian" position that public goods don't actually exist - that the unfettered market will provide plenty of basic research, infrastructure, etc. But regulation has been slashed, non-entitlement spending has been slashed, tax rates have been slashed, and essential government functions have been privatized...and, if Thiel and Cowen are right, innovation and progress have still slowed down. The Grover Norquist dog is no longer hunting.

What America needs is a conservative movement that does not simply replay yesterday's greatest hits. In the upcoming decades, one of our most pressing priorities (as Thiel recognizes in that article and elsewhere) is going to be finding an energy source to replace cheap oil and coal. This monumental task may not be (probably will not be) accomplished efficiently without massive government spending on basic research and new infrastructure. If conservatives, terrified of deviating even slightly from the Grover Norquist canon, stand in the way of this research, then either liberals will own the future, China will save us, or - more likely - our country will simply settle into a long, grumpy decline.

Moving from a Norquist conservatism to a Thiel conservatism does not mean that conservatives must abandon all their principles. They can call for shifting spending from health care to research and infrastructure, instead of raising the money via taxes. They can call for greater deregulation of biomedical research (another critical area of research). And in no way does acknowledging the important role of government in the economy force conservatives to abandon their cultural principles - hard work, sexual abstinence, Christianity, pre-1945 art, or whatever. In fact, if conservatives feel the need, as Thiel does, to couch their substantive shift in a flurry of hippie-bashing and sneering at "political correctness," well, be my guest, guys! We hippies are big boys and girls, we can take it.

But the idea that "government is the problem" is well past its sell-by date. Peter Thiel recognizes this. Let's hope the rest of the conservative movement catches on.

His thinking - like the that of most self-proclaimed 'Conservative thinkers' in the USA - is merely a mutilated and degenerate form of (classical) liberalism.

The history of political thought did not begin with the election of Richard Nixon - and, if Mr. Thiel wishes to understand Conservatism, he will have to start by reading Augustine and Aquinas, rather than Hayek and Keynes.

You are one of the best at debunking "conservative" "ideas". Dean Baker is the University Professor here.

However... It's not about policy or ideas or consequences or any of that economics stuff. It's about Morality. That is, Religion.

As such, "conservative" "ideas" can not be deconstructed successfully - they aren't made of anything other than pure belief. Viewed in this way, it's no mystery why the weirdness of "conservatism" persists: EG, there's no contradiction between me wanting to do away with Medicare and the fact that that is not in my longer term self-interest. Medicare is just evil. Remember Ayn Rand...

Krugman is fond of saying that Economics is not a morality play. I'm not sure this is right. Most people are completely unable to separate facts from morality. And the behavior of "most people" is part of Economics, no?

@Anonymous (most recent):Referencing Augustine and Aquinas as a way to understand conservatism does the ideology itself an injustice. How? It supposes that "Conservatism" (note the capital C) is some sort of archetypical worldview capable of being understood on any fundamental level. Even if this is true, I don't think this works for modern popular conservatism, lacking as it is in any conviction other than a hostility toward the "Other" - whether that other is a minority group or the federal government.

Even if Thiel is a nutbar, the fact remains that technological progress seems to have slowed down. For heaven's sake the microprocessor was invented in 1970! - the same year the 747 first flew.

We forget how much money the US poured into technology through the military in the fifties and sixties. Darpa even led the way on design techniques for large scale integrated circuits. The internet and the web were invented by publicly funded research.

A few technical breakthroughs in energy, materials and medicine might go a long way to improving standards of living. The government should quadruple government funded research. If they want to spend some stimulus money quickly they could put a hundred billion into building new labs.

Not sure about Christianity, but there is a case for putting history back into the public school curriculum and putting the Bible into the history curriculum -- as a primary document of Western culture and civilization. Kids today don't know the first thing about the Bible -- including the fact that our modern ideals of equality, freedom, and justice have their origins in it in large degree. But then I'm a liberal.

This is the fantasy of creating floating islands in international waters, so the Galt wannabes can form their commune.

It's the sort of thing one would expect from a frosh in his/her first dorm rap.

Interestingly, what this describes is a situation not unlike monasteries in the ninth century: an island in a sea of lawlessness. What happened is that they grew so rich (lack of competition) that their prime directive became maintaining their power.

If any sort of floating Libertarian-Land were physically possible, it would devolve into an oligarchy within five years. Power concentrates unless and until it's stopped.

As for the idea that we're headed for 'class warfare' is another example of his naivete. Class warfare has been raging for decades, and his class is routing the opposition. How dare the proles fight back?

And the whole tech slowdown thing sounds like an attempt at misdirection. Like claiming that we're experiencing structural unemployment as a way of absolving the plutocrats from doing anything to boost the economy for the rest of us.

What happened to the steely-eyed conservatives who took the worth of people? They'be become a bunch of magical-thinkers who live in a fantasy world.

Yeah, right - what the world needs are more of those down-to-earth individuals who keep any original and novel thinking in deep contempt. All those airplanes, submarines, computing machines, roboters, flights to the moon, speaking through the aether to individuals on the other continent - what a whimsical stuff! "Seasteading? Please."

You seem to be claiming that the idea that "government is the problem" has been the paramount conservative tenet over the past decades. (Correct me if I'm wrong.)

When you propose a theory like that (again, if it's not what you're proposing disregard everything I write here), I think it may help to back it up with factual evidence.

Could you help me understand how the idea that "government is the problem" has actually manifested itself in the total level of US government spending in any conservative administration (or budget) over the trend of the past 100 years?

That "fantasy world" also includes Facebook, Paypal, Booktrack, Slide, LinkedIn, Yelp, and many other successful online platform that have already proven how entrepreneurship and free markets improve people's lives without the user or threat of initiation of force against anyone.

Seeing you attempt to lecture someone like Thiel in one lazy ass blog comment, and ridicule one of his many projects prematurely without any actual facts or arguments against it, it's pretty darn embarrassing to be frank ...

The great stagnation is all about energy. Thiel's line about how we expected interstellar jet-pack travel and we got 140 characters instead (or something to that effect) hints at the problem, but Thiel himself seems, as John Huss says, weirdly clueless about a lot of things--and that includes the possibility that the great slowdown in technological progress is related to the great slowdown in the increase of exploitable energy. The most impressive technological progress over the past few hundred years had to do with learning how to exploit fossil fuels. Sometime in the mid to late 20th century, this exploitation started to slow down a lot. The gains since then have been cool (microprocessors, etc.), but not nearly as cool, to my mind, as the changes that had come before (rockets to the moon, electric lighting and refrigeration, the telephone, cars, etc.). We seem to be bumping up against physical limits of various kinds, and Thiel seems clueless.

OK, my previous comment was a little off. I went and read Thiel's article in the National Review, and he does mention energy--only to drop it. What does he think the explanation is, if not limits to easily exploitable energy? I still think he's a clueless bozo...

Actually the whole reason the Coffee Party failed is that it didn't have a consistent platform. On the one hand it tried to present itself as "bi-partisan" but on the other hand it only attracted liberal followers and it unreservedly attached itself to liberal viewpoints on contested issues. In the end it was really just a half-hearted "me too" movement that neither moderates or liberals were able to identify with.